Sears Holdings Corp (NASDAQ:SHLD), which is already in the process of shuttering 80 stores this year, posted a wider loss last quarter even after offering massive discounts to allure customers. Overall, Sears reported a net loss of $402 million, or $3.79 a share, compared to a prior-year loss of $279 million, or $2.63 a share. Apart from the 80 stores previously announced, the company now expects to close more stores this year.
Lampert optimistic on Sears
For the quarter ending May 3, Sears Holdings Corp (NASDAQ:SHLD) posted a 6.8% drop in revenue, a decline to $7.88 billion, but was above analyst’s expectation of $7.71 billion. Same store sales at the namesake stores surged 0.2%, but dropped 2.2% at Kmart.
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The iconic retailer is trying to grab some market share in the online segment by offering the Shop Your Way program, which integrates online shopping. According to the company’s statement, Shop Your Way member’s sales increased to 74% of eligible sales from 68% in the previous year. Gross margin for the retailer declined to 23.2% from 25.5%.
Hedge-fund investor Lampert noted in his letter to the shareholders that 2014 would be a year when Sears Holdings Corp (NASDAQ:SHLD) will showcase its efforts to develop from a store-based retailer to an integrated model. Lampert added that it may sound impossible in the light of recent financial results, “But not only do I believe that we are headed in the right direction in important ways, I believe the entire retail industry is headed to where we already are.”
Retail sector reeling
Sears Holdings Corp (NASDAQ:SHLD) is not the only retailer planning on closing its stores. Big retailers like Macy, J.C. Penney Co and American Eagle Outfitters Inc have also echoed similar sentiments due to underperforming stores. The retail sector has posted disappointing sales on an average for the latest holiday season with low footfalls along with stark winter weather cited as the main reason for the decline.
Sears Holdings Corp (NASDAQ:SHLD) will sell off its assets and spin-off businesses to revive its mass market retail stores. The company sold Lands End Inc this year taking in $500 million, and the company is still planning to spin-off its auto center business and strategic alternatives for its stake in Sears Canada.
Sears Holdings Corp (NASDAQ:SHLD) shares were trading at $33.90 before the bell Thursday. The stock has fallen about 8% this year as of Wednesday’s close.